Trade Talks with Mexico Going Well; Canada Should Wait

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In a tweet that appeared to reference NAFTA's renegotiation, the US president said the "deal with Mexico is coming along nicely" and that "Canada must wait".

Trump said that Canada has to wait, citing too-high tariffs and trade barriers. "Will tax cars if we can't make a deal!" he said.

"Discussions appear to have taken on a surprising urgency of late, with the U.S. focused on ironing out its differences with Mexico, while apparently freezing Canada out of the talks", ING analysts note.

Canada's ambassador to the US David MacNaugton told BNN Bloomberg TV that if the US and Canada can reach agreement on auto manufacturing then the three countries may be able to move forward on more of the issues that affect all three countries. In fact, the USA government decided in June to end the exemption from steel and aluminum tariffs from the EU, Canada and Mexico. A spokesperson for Canada's Foreign Affairs Minister Chrystia Freeland said Ottawa is not changing its course, despite Trump's tweets.

"Overall, while the recent push confirms our view that an agreement is just a matter of time, an early deal would help to further diminish uncertainties that have hampered investment in Mexico since President Trump was elected, nearly two years ago".

Adam Austen, a spokesman for Canadian Foreign Minister Chrystia Freeland, who is leading NAFTA trade talks for Canada, said the minister was in regular contact with her Mexican and US counterparts.

At the same time, relations with Canada have been tense since June's Group of Seven meeting held in Quebec, when President Trump renounced support for the summit's communique and took parting shots at Canadian Prime Minister Justin Trudeau for promising to stand up to US tariffs.

Adam Austen, a spokesman for Canada's foreign minister, added: "We're glad Mexico and the USA continue to work out their bilateral issues. It's the only way we'll get to a deal", Austen said. "Because you're talking about a very different two countries", President Trump said on 1 June.

To complicate matters, the already rocky Canada-U.S. relationship has deteriorated since the partners suspended talks in the spring. The U.S. and Mexico still have other issues to work out, including what percentage of auto industry components need to be made in North America to avoid tariffs, and how many cars and trucks need to be made in factories paying higher wages.

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